Direct reduced iron production in the four Middle Eastern countries covered by worldsteel's monthly report grew 17% on-year in July to 2.67 million tonnes, Kallanish notes.

This was driven by a 27% surge in production in the region’s largest DRI producer, Iran, to an estimated 1.59mt. This supported a 16.5% rise in crude steel output in July to an estimated 1.58mt. Much of Iran’s output growth has been driven by increased steel exports.

Iranian pig iron output, concentrated at sole blast-furnace based steelmaker Esfahan Steel (Esco), fell -15% in July to an estimated 180,000t.

DRI output at Saudi Arabia’s largest steelmaker, Sabic, rose 11% in July to an estimated 500,000t when crude steel output fell -20.3% to an estimated 380,000t. This suggests the steelmaker used more DRI in its feedstock mix, and possibly allocated some of the metallic for stock or merchant sales.

Production of DRI in United Arab Emirates inched down -2% in July to 350,000t but still managed to record its second-highest monthly figure in 2017 so far. This came despite crude steel output that month slumping -25% to 209,000t. This suggests more DRI was used in the feedstock mix in UAE crude steel output and some may have been sold on the merchant market.

DRI output in Qatar rose 7% in July to an estimated 235,000t when crude steel production grew 14.7% to an estimated 250,000t. This comes despite the diplomatic row that is preventing Qatar Steel from exporting to neighbouring markets.

Middle Eastern DRI production in January-July thus rose 10% on-year to 16.91mt.

Egyptian DRI output, meanwhile, surged 30% in July to 302,000t, as Ezz Steel’s latest DRI plant continues to ramp up, supporting Egyptian domestic crude steelmaking with increased local feedstock.

Iran remained the world’s largest DRI producer after the seven months with 10.41mt, followed by India with 8.59mt and Mexico with 3.64mt.